Central Bank of Nigeria Planning to Have CBDC Before End of 2021

Nigeria is planning to have its own central bank digital currency (CBDC) by the end 2021, according to an official of the Central Bank of Nigeria (CBN).

Rakiya Mohammed, the director of information technology at CBN, who made the remarks following the bankers’ committee meeting, also revealed that this “digital currency would be accessible to all Nigerians.”

However, according to a report which quotes the IT director, the CBN’s digital currency will be unlike privately issued cryptocurrencies such as bitcoin, which a Nigerian senator has previously blamed for making the naira currency “almost useless.” Emphasizing the importance of this digital currency initiative, Mohammed said:

“We have spent over two years studying this concept of the central bank digital currency and we have identified the risks. And it is one of the reasons why I said we are setting up a central governance structure that would involve all industry stakeholders to access all the risks as we continue on this journey.”

The director adds that “very soon” the CBN will be making an announcement on the date for the CBDC launch.

Meanwhile, with these latest comments, Mohammed becomes the second CBN official to suggest that a digital currency roll-out is in the works. In May 2021, CBN governor Godwin Emefiele said digital currency would “come to life even in Nigeria.”

Incidentally, both Mohammed and Emefiele’s digital currency comments have come a few months after the CBN ordered banks to stop extending their services to cryptocurrency entities. Nigerian officials blamed cryptocurrency exchanges and start-ups for fueling foreign currency shortages and for causing the naira’s depreciation on the black market.

In the meantime, with only six months left before the year ends, it remains to be seen if the digital currency promises are going to come to fruition within the planned deadline.